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1MDB: Goldman Sachs faces suit over ties to Malaysian fund

Goldman Sachs has been sued by a shareholder of one of its former clients over alleged fraudulent misrepresentations that involve links to the prime minister of Malaysia.
Primus Pacific Partners, a private equity firm and the largest shareholder in Malaysian bank EON Capital, filed suit against Goldman for $510 million for fraud and breach of fiduciary duty, according to a statement released Tuesday.
The suit claimed that Goldman Sachs concealed a conflict of interest involving Malaysian Prime Minister Najib Razak while the investment bank was acting as financial adviser to EON, which was weighing a takeover bid by Hong Leong Bank. Talks on the deal reportedly began in 2009, but the bid was held up until 2011 as Primus fought the offer in Malaysia's courts.
One of the prime minister's brothers, Nazim Razak, was a director at Hong Leong Bank, while another brother, Nazir Razak, was chairman of CIMB Group, which advised Hong Leong Bank on the bid.

At the same time as it was advising EON, Goldman was an adviser to 1Malaysia Development Berhad, also known as 1MDB, a development fund established by the prime minister, the lawsuit noted.
Primus claimed that Goldman first called the Hong Leong bid "unfair," only to reverse course weeks later. According to the suit, the final price of the merger was "hundreds of millions of dollars below fair value," but the reversal may have furthered Goldman's role as adviser to 1MDB. The original complaint can be read here.
In a statement in response to the suit, Goldman Sachs pointed out that Primus had already failed to block the deal.
"This plaintiff previously lost its challenge in the Malaysian courts seeking to stop a transaction involving a Malaysian company, which was then approved by shareholders," the investment bank said. "We will vigorously contest this misguided additional lawsuit in New York court."
After the court decision in 2011, Dow Jones reported that Primus faced a "significant loss on its investment" in EON if the takeover by Hong Leong Bank took place.

The office of Malaysia's prime minister and 1MDB did not immediately respond to emailed requests for comment.
The suit comes as 1MDB faces international regulatory scrutiny over accusations that its funds were misappropriated. U.S. prosecutors sued last week to seize more than $1 billion in assets they said were tied to a scheme to launder money stolen from the fund.
Questions about movement of funds from 1MDB gained attention about a year ago, when The Wall Street Journal reported that in 2013 nearly $700 million had flowed from the fund to Malaysian Prime Minister Najib Razak's personal bank account.
Najib has repeatedly denied wrongdoing and, under pressure from the outcry caused by the WSJ report, said the funds were not from 1MDB but were a private donation from a Middle Eastern country he declined to name. He has denied benefiting personally from the funds.
In January, Malaysia's Attorney General Mohamed Apandi Ali said that Saudi Arabia's royal family gave Najib a $681 million gift, of which Apandi said about $600 million was later returned.
Apandi said that no criminal offense had been committed. But globally, investigations into 1MDB in locales as varied as U.S., Switzerland, Singapore and the Seychelles have continued.
This month U.S. prosecutors said they were seeking to seize more than $1 billion of assets tied to an international conspiracy to launder funds funneled away from 1MDB, marking the biggest action ever taken under the Kleptocracy Asset Recovery Initiative.
In a statement, the Department of Justice said officials at 1MDB, their relatives and other associates diverted more than $3.5 billion from the state fund and laundered it through complex transactions and shell companies with bank accounts in Singapore, Switzerland, Luxembourg and the U.S.
Some of the laundered funds allegedly flowed into production of the 2013 film "The Wolf of Wall Street," a film about a corrupt stockbroker, that was banned from playing in Malaysia for being too risqué.
The film's producer, Red Granite Pictures, was co-founded by Najib's stepson Riza Aziz. Riza was named as a "relevant individual" in the DOJ complaint, but Najib wasn't named in the U.S. prosecutor's complaint.
However, the Wall Street Journal reported, citing a person with direct knowledge of the investigation, that the complaint's 32 references to "Malaysian Official 1," who allegedly received hundreds of millions from 1MDB, were a reference to Najib.
At the time, the Najib's office said in a statement, "As the Prime Minister has always maintained, if any wrongdoing is proven, the law will be enforced without exception."
Red Granite last week said in a statement that it continued to "cooperate fully" with all investigations and that "when the facts come out, it will be clear that Riza Aziz and Red Granite did nothing wrong."
Separately this week, the New York Times reported that the Federal Reserve is preparing an enforcement action against Goldman Sachs related to confidential government information which was leaked by a Fed employee to a junior Goldman banker who was a former Fed employee.

The report noted that a Goldman spokesman said in a statement that the bank had already "reviewed our policies regarding hiring from governmental institutions and have implemented changes to make them appropriately robust."

—CNBC's Kate Kelly contributed to this report.
Link: http://www.cnbc.com/2016/07/26/1mdb-goldman-sachs-faces-lawsuit-over-ties-to-malaysian-fun.html 

KLCI Malaysia Market Review & Tomorrow Forecast

The FBM KLCI index lost 6.84 points or 0.41% on Tuesday. The Finance Index fell 0.18% to 14175.85 points, the Properties Index dropped 0.29% to 1161.52 points and the Plantation Index down 0.48% to 7563.36 points. The market fluctuated between a high of 1666 and low of 1660 throughout the trading session on Tuesday. The KLCI extended its mid-day losses by ending lower at 1661.42 points amid overnight losses in US market. The performance of our benchmark index was bogged down by selling in heavyweight counters such Genting, KLCC and SapuraKencana. Top 5 Stocks for Tomorrow

Market forecast for KLCI:

The FBMKLCI opened at the level of 1666 on Tuesday and closed in the red at level of 1661. The trading session on Tuesday saw a low of 1660;

The market traded within a range of 6.48 points between an intra-day high of 1666.99 and a low of 1660.51 during the session.

Market moved side ways as the two day U.S. Federal Reserve's meeting started on Tuesday along with Bank of Japan supposed to happen on coming Friday. Fed meeting had an impact on the market as traders would be cautious before entering the market and would wait for the results to be announced. Expecting less movement in the market it could breach the support level of 1657 and come down to the level of 1647.

  KLCI COUNTER SPECIFIC NEWS :

• Bank Islam Malaysia Bhd has inked an agreement with Perbadanan Wakaf Selangor subsidiary Urus Maju Ehsan (M) Sdn Bhd (UME) to provide RM15.5 million in financing for two waqf land development projects in Klang, Selangor.
• Felda Global Ventures Holdings Bhd (FGV) saw its share price surge 5.06% yesterday after news of it aborting plans to acquire a stake in Indonesia's PT Eagle High Plantations Tbk.
• YTL Corp Bhd has proposed to take its information technology unit, YTL e-Solutions Bhd, private at 55 sen per share through a voluntary share exchange offer. This will enable YTL e-Solutions shareholders to exchange their stake in the company for shares in YTL Corp.
• Wah Seong Corp Bhd’s order book replenishment rate despite the US$18.23 million (RM73.87 million) pipe shipping and related services contract win.
   GLOBAL FACTORS AND WORLD INDICES:
• Hong Kong stocks rallied Tuesday thanks to a surge in casino shares, while investors await key central bank meetings in the United States and Japan. Hang Seng Index rose 0.62 per cent, or 136.29 points, to end at 22,129.73.
• Tokyo shares slumped for a third session Tuesday as a yen rally and worries about a global oil supply glut hit sentiment ahead of US and Japanese central bank meetings. Nikkei 225 index dropped 1.43 per cent, or 237.25 points, to close at 16,383.04
• Wall Street opened slightly lower on Monday as investors braced for another set of corporate earnings and awaited the Federal Reserve's monetary policy meeting.
• Gold inched up early Tuesday as the dollar slipped and equities eased ahead of central bank meetings in the United States and Japan this week.
• The dollar index, which tracks the greenback against a basket of six major rivals, edged down 0.1 percent, below the previous session's high of 97.569, its loftiest peak since March.
• Oil were down again on Monday as investor concerns about a supply glut showed no sign of letting up.
• Crude lost US$1.06 sinking to US$43.13, its lowest level in three months.
• Brent crude hit its lowest price since May, sinking 97 cents to US$44.72.

Weekly Wrap of KLCI And Forecast for Week Ahead

Overall week it was observed low volume in the market as we had only two and a half trading days. As we had two festive days in the week traders avoided to enter the market and hold positions. Week constituted one bullish and 2 bearish days. Market ended with a closing of 1644 and in the red.

Top 10 Stocks

Forecast for week ahead:

After one bullish closing we had two bearish closing days in the entire week, we observed a bullish candle on the last trading day. In the final session of the week market closed at the level of 1644. Volume has been on the lower side throughout the week because of the two festive days. In the coming market is expected to make a rounding bottom pattern and if it completes the pattern , it is expected to test the resistance level of 1663 and if it breaches this level it is expected to go up and test the second level of 1675. On the other side if it breached the support level of 1637 it is expected to go further down to the level of 1617.

Sup 1	Sup 2	Sup 3	Res 1	Res 2	Res 3
1637	1617	1600	1663	1675	1688

Technical indicators:

RSI for this week is 45.524 with CCI at -43.181 Besides, difference line of MACD -11.723.

Counter-Specific News:

• AmInvestment Bank Bhd bagged the “Project Finance House of the Year” and “Best Transport Deal” awards for the second consecutive year at The Asset Triple A Asia Infrastructure Awards 2016.
• Maybank IB Research said the potential sale of Hong Leong Assurance (HLA) and Hong Leong MSIG Takaful (HLMT) could raise about RM3.2 billion for Hong Leong Financial Group (HLFG), said.
• Mah Sing Group Bhd will be launching the final tower of Lakeville Residence here on July 16 and 17, which will bring the RM1.5 billion development to its targeted completion by 2020.
• Tropicana Corp Bhd’s disposal of land in Gelang Patah will reduce the group’s exposure in Johor and lock in a net gain of RM55.5 million, said Affin Hwang Capital.

Global factors and World Indices:

• Hong Kong stocks fell on Friday, tracking losses in Shanghai shares, on fears of further weakness in the yuan and worries that Britain's decision to leave the European Union could destabilise one of China's biggest export markets. Hang Seng Index fell 0.7 per cent to 20,564.17 points.
• Tokyo stocks closed in the red Friday, their fourth straight loss as an early rally fizzled. Nikkei 225 index slumped 1.11 per cent, or 169.26 points, to end at 15,106.98.
• Asian markets fell Friday morning, at the end to a volatile week dominated by the fallout from Britain's European Union exit, with investors now turning their attention to the release of US jobs data.
• The US dollar gained on the euro but slipped against the yen Thursday as investors waited to see if the coming US June jobs report shows a rebound from May's sharp downturn.
• Oil prices dived Thursday after US inventories fell less than expected last week, adding to market concerns about abundant global supplies.
• Crude tumbled US$2.29 to US$45.14 a barrel, its lowest price in nearly two months.
• Brent finished at US$46.40 a barrel, down a hefty US$2.40 from Wednesday's settlement.
• Gold headed for the longest run of weekly gains in two years, bolstered by the uncertainty surrounding the UK's vote to leave the European Union, with investors turning their attention to a monthly US jobs report.

Malaysia Market: Companies That May Be In Focus On Friday

Based on corporate announcements and news flow today, companies that may be in focus on Friday (July 8) could include: Bertam, Guocoland, TH Heavy, Melewar, Halex, Goldis and ML Global. 

TOP 5 Stocks to Buy Tomorrow

Bertam Alliance Bhd is selling two parcels of freehold land at Batu 9, Cheras, with a collective land size of 47,930 sq m (11.8 acres) to a unit of Guocoland (Malaysia) Bhd, for RM128 million.

Bertam announced to Bursa Malaysia today that it expects to recognise a RM79.84 million disposal gain arising from the land deal.

The sale was effected through Bertam's unit MV Properties Sdn Bhd, which inked a sale and purchase agreement with Tujuan Optima Sdn Bhd, Guocoland's subsidiary.

The land's audited net book value (NBV) was RM42.96 million as at Dec 31, 2015 (FY15). It was valued at RM125.11 million, as appraised by independent valuer DTZ Nawawi Tie Leung Property Consultants Sdn Bhd, on March 19, 2016.

The proceeds will be utilised for borrowings repayments and working capital. Upon that, the group should have zero gearing and enjoy an interest cost savings of about RM7.3 million a year based on the effective rate of 6% to 8.6% per annum.

The company has accumulated losses of RM38.51 million, while total borrowings stood at RM103.87 million as at Dec 31, 2015 (FY15).

Meanwhile, Guocoland intends to fund the deal fully by cash via internally generated funds and/or bank borrowings.

Guocoland does not need to seek approval from its shareholders for the land purchase. But Bertam need shareholders' approval for the sale.

TH Heavy Engineering Bhd (THHE) was slapped with two winding-up petitions from its creditors for a collective sum of US$8.88 million (RM35.6 million) in relation to the supply of equipment and work done at the floating production, storage and offloading (FPSO) Layang project.

In separate bourse filings today, THHE said the first petition was by MIB Orwell Offshore Ltd and was presented on June 30 to the Kuala Lumpur (KL) High Court. A copy of the petition was served to THHE on July 4.

It said the petitioner is claiming US$7.61 million for the supply of equipment and machinery for the FPSO Layang project, and the case management for the petition has been fixed on July 20.

The second petition is by MIB Italiana SPA and was presented to the KL High Court on July 1; a copy of it was also served to THHE on July 4.

THHE said the second petitioner is claiming US$1.27 million for the supply and installation of quick release hook and mooring hawser for the same project. Case management for this petition has been set on July 15.

THHE said it has sought necessary legal advice on both matters with a view of defeating the petitions altogether, adding that the petitions would not have any additional financial and operational impact on the group.

Melewar Industrial Group Bhd has decided to drop its appeal against MyCC's finding that Megasteel Sdn Bhd did not abuse its dominant position or practise anti-competition margin squeeze in the cold rolled coil market.

Megasteel's lawyers have been informed today that Melewar had, on June 21, withdrawn the appeal with no objection from MyCC, which stands for the Malaysian Competition Commission, according to a bourse filing by Melewar's parent company, Lion Corp Bhd.

Lion Corp, which owns 79.89% of Megasteel, said following Melewar's withdrawal, the case against Megasteel is now 'closed' and that MyCC's finding of non-infringement of the Competition Act 2010 by Megasteel is 'final'.

Halex Holdings Bhd's executive director and chief executing officer (CEO) Chan Yee Keen has decided not to renew his employment contract upon expiry of the contract on Sept 30.

According to its filing with Bursa Malaysia today, Halex said Chan, 45, had informed that he would like to pursue his own personal interests after fulfilling his contract with the company.

He was appointed as the group's executive director and CEO on Oct 1, 2015.

"The board meanwhile would be taking steps to engage a replacement and an appropriate announcement would be made in due course," it said.

Goldis Bhd has declared a first interim dividend of two sen per share for the financial year ending Dec 31, 2016, to be paid out on Aug 12.

The company announced to Bursa Malaysia that the ex-date for the dividend will be on July 22.

"Holders of Redeemable Convertible Cumulative Preference Shares (RCPS) are reminded to lodge with the registrar of the company, Tricor Investor & Issuing House Services Sdn Bhd, their conversion forms by 5pm on or before July 14, 2016, in order to be entitled to the first interim dividend," the filing read.

ML Global Bhd has redesignated its non-independent director Tan Sri Lim Hock San as its managing director (MD), replacing Beh Hang Kong who was redesignated as executive director, effective today.

The boardroom changes came after LBS Bina Group Bhd, an entity controlled by Lim, gained control of ML Global with an equity stake of 50.92%.

Beh has been MD at ML Global since Jan 16, 2008. He has been appointed as executive director at Yong Tai Bhd since Jan 15, 2016.

Meanwhile, ML Global also redesignated its non-independent director Datuk Wira Lim Hock Guan as its executive director.

Source: theedgemarkets

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Malaysia Inflation Rate at 13-Month Low

Consumer prices in Malaysia rose 2.0 percent year-on-year in May of 2016, compared to a 2.1 percent gain in April and matching market estimates. It was the lowest inflation figure since April 2015 as prices of food and housing & utilities eased while cost of transport fell further.

Live Trading Signals

Year-on-year, prices moderated for: food & non-alcoholic beverages (+4.1 percent in May from +4.2 percent in April); housing, water, electricity, gas & other fuels (+2.2 percent from +2.6 percent); furnishing, household equipment & routine maintenance (+2.2 percent from +2.6 percent); health (+2.0 percent from +2.2 percent); recreation services & culture (+1.5 percent from +1.6 percent), restaurants & hotels (+2.5 percent from +2.7 percent) and miscellaneous goods & services (+2.5 percent from +2.6 percent). Price rose at a faster pace for: alcoholic beverages & tobacco (+22.1 percent from +20.1 percent) and education (+2.2 percent from +2.1 percent). In contrast, cost declined for clothing & footwear (-0.9 percent from -0.7 percent), transport (-5.6 percent from -5.5 percent) and communication (-2.2 percent from -2.1 percent).

Calendar	GMT	Reference	Actual	Previous	Consensus	Forecast
2016-04-20	4:00 AM	Mar	2.60%	4.20%	3.60%	3.70%
2016-05-20	4:00 AM	Apr	2.10%	2.60%	2.20%	2.20%
2016-06-15	4:00 AM	May	2.00%	2.10%	2%	2.20%
2016-07-20	4:00 AM	Jun		2%		2.30%
2016-08-24	4:00 AM	Jul				2.60%
2016-09-21	4:00 AM	Aug				2.40%

Among food & non-alcoholic beverages, customers had to pay more for: food (+4.2 percent in May from +4.4 percent in April); food at home (+4.6 percent from +4.6 percent); rice, bread & other cereals (+0.9 percent from +0.9 percent); meat (+0.3 percent from +0.5 percent); fish & seafood (+6.6 percent from +8.4 percent); milk & eggs (+1.1 percent from +0.1 percent), oils & fats (+0.4 percent from +0.4 percent), fruits (+6.1 percent from +7.3 percent); vegetables (+15.3 percent from +12.5 percent); sugar, jam, honey, chocolate & confectionary (+1.8 percent from +2.1 percent); food products (+5.3 percent from +4.9 percent) and food away from home (+3.6 percent from +3.9 percent) and coffee, tea, cocoa & non-alcoholic beverages (+0.6 percent from +1.0 percent). 

Forecast	Actual	Q2/16	Q3/16	Q4/16	Q1/17	2020	Unit
Inflation Rate	2	2.3	3.1	3.3	3.4	3.47	percent

Core consumer prices rose by 2.1 percent year-on-year in May, slowing from 2.3 percent in the preceding month.

On a monthly basis, consumer prices rose 0.3 percent, after gaining 0.4 percent in April. Upward prices pressure came from:  food & non-alcoholic beverages (+0.3 percent), alcoholic beverages & tobacco (+0.1 percent), housing, water, electricity, gas & other fuels (+0.5 percent), health (+0.1 percent), recreation services & culture (+0.1 percent), restaurants & hotels (+0.2 percent) and miscellaneous goods & services (+0.2 percent). In contrast, prices declined by 0.1 percent for clothing & footwear. Prices remained unchanged for: furnisshing, household equipment & routine maintenance, transport, communication and education.

Source: http://www.tradingeconomics.com

Market forecast for KLCI 25 May

The FBM KLCI closed in the red at the level of 1625, leaving the entire body within the limits of the previous days candle. In-spite of the bearish performance of the index, select counters did perform today giving the traders a chance to go bargain hunting. Upper ceiling for tomorrow would be around1634 and a lower level would be at 1621. We do expect counters that gave breakouts today supported by volume to sustain their up-trend and go higher. Stocks to sell tomorrow

KLCI COUNTER SPECIFIC NEWS :

• Felda Global Ventures Holdings Bhd slipped into the red in its first quarter ended March 31, 2016 (1QFY16) with a net loss of RM65.54 million, compared with a net profit of RM3.58 million a year ago, primarily on lower crude palm oil (CPO) production in its palm upstream segment.
• Hong Leong Financial Group Bhd reported a 13% drop in its third quarter net profit from a year earlier as net interest and non-interest income declined.
• Affin Holdings Bhd net profit in its first quarter of the fiscal year ending Dec 31, 2016 (1QFY16) surged by 284.13% to RM115.57 million, from the previous corresponding quarter’s RM30.09 million, owing mainly to lower allowance from loan impairment and higher loan recoveries.
• Hong Leong Financial's 3Q net profit down 13% on year at RM315m.
• Felda Global's 1Q net loss at RM66m vs RM4m net profit a year earlier.
• Dayang Enterprise Holdings Bhd, which is keen to maintain the listing status of its subsidiary, Perdana Petroleum Bhd, will divest at least 25% of the group's total stake.
• KUB Malaysia Bhd business realignment strategy to further enhance its operations has already yielded positive results over its past full financial year.

GLOBAL FACTORS AND WORLD INDICES:

• Asian stock markets fell in thin trading today, as oil prices deflated energy shares, while Singapore said it was kicking out a Swiss bank linked to Malaysia's 1MDB.
• Hong Kong shares finished up today despite a fall in mainland indexes.The Hang Seng index rose 0.1 per cent, to 19,830.43, while the China Enterprises Index was flat at 8,306.56 points.
• China stocks closed lower today as resources firms were hit by slumping commodity prices amid worries over China's economic health.
• European shares slipped lower today, as the prospect of a possible US interest rate increase in coming weeks knocked back global stock markets.The pan-European FTSEurofirst 300 and STOXX 600 indexes both fell 0.5 per cent in early session trading.
• Tokyo shares slipped for a second straight session today as lower oil prices hurt sentiment, with investors now eyeing a G7 leaders' summit in Japan this week.
• Australian shares were down for a second day in subdued trade today, as falling oil prices pressured energy firms although miners proved resilient to more weakness in iron ore.
• Gold held a four-day decline as more Federal Reserve officials weighed in with comments that supported the case for higher borrowing costs, strengthening the outlook for the dollar and denting the metal's allure.
• Oil prices fell in thin trade today as the US dollar strengthened, but losses were curbed by a likely draw down in U.S. crude and gasoline stockpiles.

KLCI Will Rose on Tuesday- Malaysia Stock Market Forecast

 The FBMKLCI closed in the positive at a level of 1634 with a low of 1621 during the day. if the traders take a cue from the bullish closing we saw today; a move above the level of 1637 should see a closing around the level of 1645. A bearish move is expected to fall till 1611. Tomorrow Stocks

   Inter-Pacific Securities Sdn Bhd research head Pong Teng Siew told theedgemarkets.com over telephone that the KLCI's gain "was supported by bargain hunting by some investors".

   According to him, the KLCI's recent fall had spurred bargain-hunting activity among investors on selected blue chips. "Investors are buying into technology-related stocks (due to weakening ringgit) and construction-related stocks," Pong said.

KLCI COUNTER SPECIFIC NEWS :

• Malaysia Airlines Bherad is adding two new Airbus A350-900s with Air Lease Corporation (ALC) which will be delivered in 2018.
• EG Industries Bherad has secured a US$36mil (RM146mil) contract to be the sole manufacturer for Flic, the world’s first wireless smart button that creates a short-cut to favourite actions on mobile devices.
• CIMB Bank Bherad and Credit Guarantee Corporation Malaysia Bherad (CGC) have signed a memorandum of understanding (MoU) to add another RM750mil to the existing RM250 million.
• Enterprise Clean Loan (ECL), as part of a joint initiative to nurture and develop Malaysian Small and Medium Enterprises (SMEs).

GLOBAL FACTORS AND WORLD INDICES:

• Asia's benchmark stock index rebounded from four weeks of losses as Chinese and Taiwanese shares gained while Japanese equities pared a steep loss.
• China stocks edged higher,Blue-chip CSI300 index rose 0.3 per cent, to 3,087.22, while the Shanghai Composite Index gained 0.6 per cent, to 2,843.65 points.
• Hong Kong shares gave up initial gains and ended Monday flat, reflecting continued investor caution amid worries about China's economy and a possible US interest rate hike next month.
• Malaysian shares ended higher on Monday with the Kuala Lumpur Composite Index up 6.1 points to close at 1,634.89.
• Oil prices dipped in Asia Monday after Iran said it has no plans to join any output freeze by other major crude producers.
• Gold rebounded from the longest run of weekly losses this year after a rally in the dollar paused and investors expanded bullion holdings while debating the possible timing of a US interest rate increase.
  

Malaysia's KLSE Stock Market Forecast for Friday, 20 May 2016

The FBM KLCI failed to continue with past two days bullish streak on Thursday and closed in red.The KLCI Closed at the level of 1633, almost in the same zone as on Tuesday. The bearish closing just before the last trading day of the week sends in negative signals with even less volume expected on Friday. Any move above the 1637 level is expected to touch the 1643 level whereas a bearish swipe below the 1621 level is expected to fall till 1611.

Stocks for Tomorrow

Today's Market Review for KLCI:

The FBM KLCI index lost 1.96 points or 0.12% on Thursday. The Finance Index fell 0.58% to 14267.19 points, the Properties Index up 0.16% to 1154.09 points and the Plantation Index rose 0.45% to 7516.1 points. The market fluctuated between a high of 1635 and low of 1621 throughout the trading session on Thursday. The KLCI continued with its losses inspite of overnight mixed performance in Wall Street after Federal Reserve meeting minutes boosted speculation that the central bank will raise interest rates as soon as June.

COMMODITY

CRUDE OIL: $47.23

GOLD: $1255.35

SILVER: $16.670 

MAJOR CURRENCY PAIRS

 SGD/USD: 0.7248

EUR/USD: 1.1220

GBP/USD: 1.4642

KLCI COUNTER SPECIFIC NEWS 

• Theta Edge Behrad recorded a net profit of RM1.04 million or 0.97 sen per share for the first quarter ended March 31, 2016 (1QFY16), compared with a net loss of RM2.18 million or 2.03 sen per share a year ago, mainly due to higher revenue contribution from value-added services and operations and maintenance works.
• Hup Seng Industries Bherad saw its net profit for the first quarter ended March 31, 2016 (1QFY16) nudge up by 2.77% to RM13.6 million from the RM13.23 million recorded in 1QFY15, mainly driven by higher sales.
• Aeon Co. (M) Behrad is allocating RM650mil of capital expenditures for its financial year 2016. It will go towards the opening of new stores and refurbishments of present ones such as those in Mid Valley.
• Volkswagen Group Malaysia Sdn Behrad aims to beat last year's record sales of 7,000 units, boosted by three new sedan models, despite expectations of softer total industry volume (TIV) this year.
• UMW Holdings Behrad, through its unit UMW Aerospace Sdn Behrad, has allocated RM750 million for capital expenditure over the next two-and-a-half years.
• IOI Corporation Behrad unit Loders Croklaan Group B.V. and Ireland's LCK Nutrition Ltd have called off their joint venture which would have involved the development of the nutrition lipid Betapol.
• Construction company Hock Seng Lee Behrad’s (HSL) net profit fell 17.17% to RM16.25mil in the first quarter ended March 31 from RM19.62mil previously.
• Petroleum National Behrad's group pre-tax profit fell 60% in the first quarter ended March 31, 2016 to RM6.8bil as it was impacted by lower revenue and prolonged weak prices and it expects the challenging times to continue.

GLOBAL FACTORS AND WORLD INDICES:

• Asia stocks were mostly down today, with energy and commodity firms taking a beating as investors digested news that an imminent Federal Reserve interest rate hike could be on the cards.
• Hong Kong stocks closed at the lowest level in 2-1/2 months today, joining most Asian markets in sliding on the growing possibility of another US rate hike soon.The Hang Seng index fell 0.7 per cent, to 19,694.33, the lowest close since March 1.
• China stocks were little changed today, and trading volume shrank to near 3-1/2-month lows as many investors sat on their hands amid economic worries and revived concerns US interest rates will go up soon.
• European stock markets slid at the start of trading today following losses across Asia and on Wall Street after the Federal Reserve hinted at a June interest rate hike.
• Tokyo shares closed flat today as investors weighed news that a US interest rate hike was increasingly likely, while energy stocks tanked after oil prices tumbled from six-month highs.
• US dollar jumped yesterday after the minutes to the Federal Reserves end-April meeting showed the central bank far more bullish about a possible June rate hike than markets had understood.
• Gold traded near a three-week low on concern that the Federal Reserve may raise interest rates as soon as June after the possibility was flagged in the minutes from policy makers' meeting last month.

Market Forecast for KLCI Malaysia: Thursday, 19 May 2016

The FBMKLCi closed in Green for the second consecutive day on Wednesday closing at the level of 1635. The traders should by now have gained some confidence and are expected to reenter the market tomorrow. A bullish move above the 1638 level accompanied by boost in volume should help to close around the 1644 level. On the other hand, a bearish swipe till the 1624 level is expected.  Top Stocks for Tomorrow

 KLCI COUNTER SPECIFIC NEWS:

• AYS Ventures Bhd has slipped into the red for the fourth financial quarter ended March 31 (4QFY16), with a net loss of RM477,000 or 0.13 sen per share.The steel products trader had recorded a net profit of RM5.68 million or 1.49 sen a share for 4QFY15.
• Standard Chartered Bank expects Bank Negara Malaysia (BNM) to cut the overnight policy rate (OPR) by 25 basis points (bps) to 3% tomorrow.
• One of the world's major mobile operators, Norway-based Telenor Group, announced today that it has acquired a Malaysian-based licensed money services business to reinforce its financial services footprint in Asia.
• Digi Telecommunications Sdn Bhd (Digi) will launch its 4G LTE Carnival tomorrow at all its 150 Digi Stores & Digi Stores Express nationwide.
• SP Setia Bhd is confident of achieving its sales target of RM4 billion this year, says president and CEO Datuk Khor Chap Jen.He said the sales would derive from new property launches and existing developments.
• Malaysia Packing Industry Bhd (Maypak) said a piece of land owned by the company in the city will be compulsorily acquired by the government for the Mass Rapid Transit (MRT) 2 project.
• EA Technique (M) Bhd foresees no challenges in its floating, storage and offloading (FSO) segment, as most of its contracts serve the downstream segment and are on long-term charters, as opposed spot charters.

GLOBAL FACTORS AND WORLD INDICES:

• Asian stock markets mostly fell today after a two-day rally and strong US data that fueled talk of an interest rate rise, while Tokyo swung back and forth following a better-than-forecast economic growth reading.
• Hong Kong stocks tumbled today, with sentiment hurt by weakness on Wall Street, following comments from Federal Reserve officials that rekindled prospects of a US interest rate rise as soon as June.
• China's benchmark stock index closed at the lowest level in 2-1/2 months today, after comments from Federal Reserve officials rekindled prospects of a US interest rate rise as early as June.
• European shares fell today, tracking losses on Asian and US stock markets that were caused by renewed expectations that the US Federal Reserve could raise rates later this year.
• Japanese stocks ended the day flat today after the yen see-sawed against the US dollar, rising and falling in strength as investors digested Japan's stronger-than-expected GDP data and US inflation.
• The US dollar rallied broadly in Asia today as a string of US economic data and bullish commentary from two Federal Reserve policymakers spurred talk of a US interest rate hike.
• Gold fell, snapping three days of gains, as bets on the Federal Reserve lifting interest rates this year ticked higher after stronger-than-expected economic data.
• Crude hit fresh 2016 highs in its march toward US$50 in Asia today, fanned by escalating wildfires in Canada's oil sands region and hopes of an easing in the oversupply.

STATISTICS:

• Consumer price inflation in South Africa rose less-than-expected in the last quarter, to a seasonally adjusted annual rate of 0.8%, from 0.8% in the preceding quarter and has expected South African CPI to rise 0.9% in the last quarter.
• Australia’s wage price index fell unexpectedly in the last quarter, to a seasonally adjusted 0.4%, from 0.5% in the preceding quarter and has expected Australian wage price index to remain unchanged at 0.5% in the last quarter.
• Japanese gross domestic product rose more-than-expected in the last quarter, to a seasonally adjusted 0.4%, from -0.4% in the preceding quarter whose figure was revised down from -0.3% and has expected Japan’s GDP to rise 0.1% in the last quarter.
• Produce price inflation output in New Zealand fell unexpectedly last month, to a seasonally adjusted annual rate of -0.2%, from -0.8% in the preceding month and has expected New Zealand PPI Output to rise 0.4% last month.

It Was A Relief for Investors After IPIC Paid the Interest for 1MDB

The FBM KLCI rose 4.4 points or 0.3% after International Petroleum Investment Co (IPIC) paid the interest on 1Malaysia Development Bhd's (1MDB) bonds.

Free Trading Signals 

At 5pm, the KLCI closed at 1,648.98 points. Yesterday, IPIC said it paid interest amounting to US$52.41 million (about RM211 million) on the US$1.75 billion 5.99% notes issued by 1MDB Energy Ltd.

Today, Etiqa research head Chris Eng told theedgemarkets.com "it was a relief for investors after IPIC paid the interest for 1MDB."

He said since late April, the market had been selling too fast and there was room for stabilisation for another week.

"There is more room for market stabilisation, the downside in the short term is limited, barring the sell down in the US," Eng said.

Across Bursa Malaysia, 449 gainers outpaced 395 decliners. The bourse saw 2.05 billion shares valued at RM1.81 billion traded.

Top gainer was Genting Bhd while top decliner was Nestle (M) Bhd. Meanwhile, the most-active counter was mTouche Technology Bhd.

Across Asian share markets, Japan's Nikkei 225 rose 0.41% while Hong Kong's Hang Seng dipped 0.7%.

Reuters reported that Asian shares fell on Thursday following a dismal session on Wall Street, while the dollar firmed but remained shy of this week's highs and crude oil gave back some of its recent gains.

Source: http://www.theedgemarkets.com/my/article/klci-rises-after-ipic-pays-1mdb-bond-interest?type=Latest%20News